I'm the one you can trust, says PM

Julia Gillard has tackled head on her principal perceived weakness among voters by framing the next federal election as being about trust.

After the routing of the Labor government in Queensland on Saturday put the Prime Minister's trustworthiness at the centre of the political debate, Ms Gillard went on the front foot yesterday, mimicking the strategy John Howard adopted at the start of the 2004 election campaign.

"I'm happy now and in the 2013 election to say 'who do you trust to manage the economy in the interests of working people?'" ... Prime Minister Julia Gillard.Credit:Penny Bradfield

''I'm happy now and in the 2013 election to say 'who do you trust to manage the economy in the interests of working people?','' Ms Gillard said from South Korea where she is attending a nuclear summit with world leaders.

''Who do you trust to understand the needs of the future and the building of that future economy?

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''Who do you trust to spread the benefits of the mining boom to make sure that they are shared by all Australians? Who do you trust to improve your local schools and local hospitals?''

According to the latest count after the election, Labor is likely to be reduced from 51 seats to eight.

Campbell Newman's Liberal National Party leapt from 31 seats to a forecast 77 in the 89-member Parliament.

The devastation has sent shockwaves and panic through federal Labor, which holds only eight of the 30 federal seats in Queensland, all of which would be lost with a swing just half the size of that on Saturday.

Labor, which had been in power in Queensland for 20 of the past 22 years, was always going to lose but the enormity of the loss was attributed in part to the decision of the defeated premier, Anna Bligh, to privatise assets and abolish a petrol subsidy for motorists - all without a mandate - soon after she won the last election.

''The Queensland election certainly is a verdict on governments that don't tell the truth,'' he said. He conceded that while a price on carbon per se was not a pivotal issue in the campaign, the cost of living was and this and the carbon tax were ''really flip sides of the same coin''.

''You've got to listen to the Australian people. You can't run away from democracy and I think the Prime Minister should be taking a long, hard look at herself, her government and her party as a result of the verdict of the people of Queensland.''

Ms Gillard admitted she was surprised by the scale of the rout in Queensland but said she would not be making any changes to the scheme to price carbon, which is due to start on July 1.

She reiterated that she meant what she said before the election about not having a carbon tax. But the hung parliament meant her policy options were more limited and the only other choice was to do nothing about climate change.

''And there is no place in the country that stands to better prosper from a clean energy future than Queensland, because of its natural assets and natural advantages,'' she said.

The Labor strategist Bruce Hawker said Ms Bligh had never recovered from her broken promise and establishing trust was now Ms Gillard's ''big challenge''.

The former Queensland premier Peter Beattie said last night that Ms Gillard and her ministers needed to expend ''an enormous effort'' in Queensland between now and the federal election.

Mr Beattie and Mr Hawker said this involved selling the benefits of the carbon and mining taxes, which include pension increases, tax breaks and infrastructure investment.

Ms Gillard responded, saying: ''Labor in Queensland, state Labor - has got a lot of rebuilding to do. We've got a lot of hard work to do and I'll get on and do it.''

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The Trade Minister, Craig Emerson, a Queenslander, said: ''Plenty of people are going to get the opportunity to meet Julia Gillard''.

Phillip Coorey writes on news specialising in policy, politics and budget. Based in our Canberra newsroom, Phil is the Australian Financial Review's chief political correspondent. He is a former chief political correspondent for The Advertiser and The Sydney Morning Herald, and a two-time winner of the Paul Lyneham award for press gallery excellence.